Print Friendly HOUSE BILL NO. 194 – MV dealer license, insurance
HOUSE BILL NO. 194
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H0194.........................................by TRANSPORTATION AND DEFENSE
MOTOR VEHICLE DEALER - LICENSE - Adds to and amends existing law relating
to licensing of motor vehicle and vessel dealers and manufacturers to
require a certificate of insurance as a condition of licensure or renewal
of a license; to provide for suspension of a dealer's or manufacturer's
license for failure to maintain a principal place of business; and to
provide for assessment of a reinstatement fee prior to reissuing a
previously suspended license.
02/11 House intro - 1st rdg - to printing
02/14 Rpt prt - to Transp
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 194
BY TRANSPORTATION AND DEFENSE COMMITTEE
1 AN ACT
2 RELATING TO LICENSING OF MOTOR VEHICLE DEALERS AND SALESMEN; AMENDING SECTION
3 49-1607, IDAHO CODE, TO PROVIDE FOR ASSESSMENT OF A REINSTATEMENT FEE;
4 AMENDING SECTION 49-1608, IDAHO CODE, TO REQUIRE PAYMENT OF A REINSTATE-
5 MENT FEE AND TO MAKE TECHNICAL CORRECTIONS; AMENDING CHAPTER 16, TITLE 49,
6 IDAHO CODE, BY THE ADDITION OF A NEW SECTION 49-1608A, IDAHO CODE, TO
7 REQUIRE A CERTIFICATE OF INSURANCE AS A CONDITION OF OBTAINING OR RENEWING
8 A VEHICLE OR VESSEL DEALER'S OR MANUFACTURER'S LICENSE, TO PROVIDE FOR
9 FILING A CERTIFICATE WITH THE IDAHO TRANSPORTATION DEPARTMENT AND TO PRO-
10 VIDE FOR REINSTATEMENT OF A LICENSE SUSPENDED FOR FAILURE TO MAINTAIN
11 INSURANCE; AND AMENDING SECTION 49-1612, IDAHO CODE, TO PROVIDE FOR SUS-
12 PENSION OF A DEALER'S OR MANUFACTURER'S LICENSE FOR FAILURE TO MAINTAIN A
13 PRINCIPAL PLACE OF BUSINESS, TO PROVIDE FOR APPEAL OF THE SUSPENSION, TO
14 REQUIRE PAYMENT OF A REINSTATEMENT FEE, TO PROVIDE PROPER TERMINOLOGY AND
15 TO MAKE A TECHNICAL CORRECTION.
16 Be It Enacted by the Legislature of the State of Idaho:
17 SECTION 1. That Section 49-1607, Idaho Code, be, and the same is hereby
18 amended to read as follows:
19 49-1607. FEES -- FUNDS -- EXPENSES -- EXPIRATION OF LICENSES. (1) The
20 department shall collect with each application for licensure, the following
22 (a) Dealer's, wholesale dealer's and vehicle manufacturer's license, ini-
23 tial application, one hundred twenty-five dollars ($125), ten dollars
24 ($10.00) of which shall be deposited in the county current expense fund.
25 Renewal application, one hundred dollars ($100).
26 (b) Vehicle salesman's license, twenty-five dollars ($25.00), ten dollars
27 ($10.00) of which shall be deposited in the county current expense fund.
28 (c) Distributor-factory branch-distributor branch license, one hundred
29 dollars ($100).
30 (d) Representative's license, twenty-five dollars ($25.00).
31 (e) To reissue a license, salesman and dealer identification cards or
32 other licensing documents at a dealer's request, not resulting from an
33 error by the department, a fee of ten dollars ($10.00) per document.
34 (f) Supplemental lot license or relocated principal place of business,
35 and temporary supplemental lot, twenty-five dollars ($25.00) for license
36 issued to a single dealer. A fee of fifty dollars ($50.00) for a license
37 issued to a group of dealers for a temporary supplemental lot.
38 (g) Reinstatement fee, five hundred dollars ($500). Reinstatement fee is
39 due prior to reinstatement or renewal of any license issued pursuant to
40 this chapter which was previously suspended, revoked or canceled.
41 (2) All fees shall be paid over to the state treasurer for credit to the
42 state highway account out of which shall be paid the expenses of the depart-
43 ment and the expenses incurred in enforcing the provisions of this chapter.
1 (3) Dealer licenses, if not suspended or revoked, may be renewed from
2 year to year upon the payment of the fees specified in this section to accom-
3 pany applications, and renewals shall be made in accordance with the provi-
4 sions of section 49-1634, Idaho Code.
5 (a) There shall be twelve (12) licensing periods, starting with January
6 and ending in December. A dealer's license shall be in effect from the
7 month of initial licensing through the last day of the next year's calen-
8 dar month that precedes the month of the initial licensing.
9 (b) Any renewal license application received or postmarked after thirty
10 (30) days from the end of the previous year's license period shall be
11 processed as an initial application and initial fees shall be paid.
12 (4) Salesman licenses, if not suspended or revoked, shall be valid for
13 three (3) years from the date of issue provided that:
14 (a) Employment remains with the sponsoring dealership; and
15 (b) The sponsoring dealership has a valid license issued by the depart-
17 Renewals shall be issued in accordance with the provisions of section 49-1635,
18 Idaho Code.
19 SECTION 2. That Section 49-1608, Idaho Code, be, and the same is hereby
20 amended to read as follows:
21 49-1608. LICENSE BOND. (1) Before any dealer's license shall be issued by
22 the department to any applicant, the applicant shall procure and file with the
23 department good and sufficient bond in the amount shown, conditioned that the
24 applicant shall not practice any fraud, make any fraudulent representation or
25 violate any of the provisions of this chapter, rules and regulations of the
26 department, or provisions of chapter 5, title 49, section 49-1418, or chapter
27 6, title 48, Idaho Code, or federal motor vehicle safety standards, or odome-
28 ter fraud in the conduct of the business for which he is licensed.
29 (a) All dealers, including wholesale, but excluding a dealer exclusively
30 in the business of motorcycles and motor scooters, all-terrain vehicles
31 and snow machine sales, twenty thousand dollars ($20,000).
32 (b) A dealer exclusively in the business of motorcycle and motor scooter
33 sales, all-terrain vehicles and snow machine sales, ten thousand dollars
35 (2) The bond required in this section may be continuous in form and the
36 total aggregate liability on the bond shall be limited to the payment of the
37 amounts set forth in this section. The bond shall be in the following form:
38 (a) A corporate surety bond, by a surety licensed to do business in this
39 state; or
40 (b) A certificate of deposit, in a form prescribed by the director; or
41 (c) A cash deposit with the director.
42 (3) If a bond is cancelled canceled or otherwise becomes invalid, upon
43 receiving notice of the cancellation or invalidity, the department shall imme-
44 diately suspend the dealer's license and take possession of the license
45 itself, all vehicle plates used in the business and all unused title applica-
46 tions of the licensee. The licensee is entitled to a hearing which shall be
47 held within twenty (20) days of the suspension. Upon receiving notice that a
48 valid bond is in force, the department shall immediately reinstate the
49 license, upon payment of the reinstatement fee as required pursuant to section
50 49-1607, Idaho Code.
51 (4) The bond requirements of this section shall be satisfied if the
52 applicant is a duly licensed manufactured home dealer in accordance with chap-
53 ter 21, title 44, Idaho Code, and the bond required by section 44-2103, Idaho
1 Code, otherwise meets the requirements of this section. The amount of the bond
2 shall be in the amount as required in this section or that required in section
3 44-2103, Idaho Code, whichever is greater. The applicant shall furnish a cer-
4 tified copy of the bond as required in section 44-2103, Idaho Code, to the
6 SECTION 3. That Chapter 16, Title 49, Idaho Code, be, and the same is
7 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
8 ignated as Section 49-1608A, Idaho Code, and to read as follows:
9 49-1608A. CERTIFICATE OF INSURANCE. (1) A certificate of insurance is
10 required prior to issuance or renewal of any vehicle or vessel dealer's or
11 manufacturer's license issued pursuant to this chapter. The certificate shall:
12 (a) Be issued by an insurance carrier licensed to do business within this
14 (b) Verify that the insured person is covered by a policy that provides,
15 at a minimum, the limits of coverage as required under section 49-117,
16 Idaho Code, relating to proof of financial responsibility;
17 (c) Verify that the insured person is covered by a policy that provides
18 for payment of judgments as required in section 49-1206, Idaho Code;
19 (d) Verify that the insured person's policy covers all vehicles manufac-
20 tured, owned, operated, used or maintained by or under the control of the
22 (e) Verify that the insured person's policy covers all other persons who,
23 with the consent of the insured, use or operate vehicles manufactured,
24 owned or maintained by or under the control of the insured person.
25 (f) Be dated as of the date of the motor vehicle policy for which it is
27 (g) Contain the policy number; and
28 (h) Contain a provision requiring that the insurer shall notify the
29 department in writing of any cancellation of the policy and that the
30 insurer shall continue to be liable under the policy until the department
31 receives the notice or until the cancellation date specified in the
32 notice, whichever occurs later.
33 (2) The written certificate of insurance shall be filed upon a form
34 approved by the department and shall be held by the department.
35 (3) If a certificate of insurance is canceled or otherwise becomes
36 invalid, upon receiving notice of the cancellation or invalidity, the depart-
37 ment shall immediately suspend the license and take physical possession of the
38 license, all vehicle plates used in the business and all unused title applica-
39 tions of the licensee. The licensee is entitled to a hearing which shall be
40 held within twenty (20) days of the suspension. Upon receiving a valid certif-
41 icate of insurance and payment of the reinstatement fee, the department shall
42 immediately reinstate the license.
43 (4) The provisions of this section are supplemental to and shall not be
44 construed to alter or affect the provisions of section 49-1212, Idaho Code.
45 SECTION 4. That Section 49-1612, Idaho Code, be, and the same is hereby
46 amended to read as follows:
47 49-1612. NOTICE OF CHANGE OF ADDRESS. (1) The department shall not issue
48 a dealer's or manufacturer's license to any applicant who does not have a
49 principal place of business.
50 (2) Should the dealer or manufacturer change the site or location of his
51 principal place of business, he shall immediately upon making the change
1 notify the department, and a new license shall be granted for the unexpired
2 portion of the term of the license, providing the new location meets all the
3 requirements for a principal place of business.
4 (3) Should a dealer or manufacturer cease to be in possession of a prin-
5 cipal place of business from and on which he conducts the business for which
6 he is licensed, he the dealer's or manufacturer's license shall be suspended.
7 The licensee shall have twenty (20) days to appeal the suspension as provided
8 in section 49-1618, Idaho Code.
9 (4) The dealer or manufacturer shall immediately notify the department
10 and upon demand by the department shall deliver the dealer's or manufacturer's
11 license, which shall be held and retained until it shall be made to appear to
12 the department that the licensee has again come into possession of a principal
13 place of business, whereupon the dealer's or manufacturer's license shall,
14 upon payment of the reinstatement fee, be reissued to him , without charge.
15 (5) Nothing in the provisions of this chapter shall be construed to pre-
16 vent a dealer or manufacturer from conducting the business for which the
17 dealer or manufacturer is licensed at one (1) or more licensed supplemental
18 lots or locations not contiguous to the dealer's or manufacturer's principal
19 place of business but operated and maintained in conjunction with it.
STATEMENT OF PURPOSE
The purpose of this legislation is to require that licensed motor
vehicle dealers provide the Idaho Transportation Department with a
verification of existence of a business liability insurance policy for
motor vehicle dealers. The legislation outlines the requirements of
such a policy which are similar to the requirements of dealer bonds.
The legislation is intended to protect the public from small vehicle
dealers with minimal assets who fail to have the required liability
insurance, as specified in Idaho Code 49-1230 and 49-117, in case of
an accident. The legislation also initiates a reinstatement fee to
renew or reinstate licenses for motor vehicle dealers who have had
their licenses revoked, cancelled, or suspended. This will help
alleviate some of the costs incurred to the Idaho Transportation
Department when canceling, then shortly thereafter reinstating, the
vehicle dealers licenses.
One full time PCN at $35,000 annually
Capital money for PCN (one time) $5,000
Programming (one time) approximately $8,500
Revenue is estimated at 200 reinstatements annually at $500 for
approximately $100,000 in revenue.
Name: Rep. Bob Nonini
Name: China Veldhouse, Independent Auto Dealers Assoc.
STATEMENT OF PURPOSE/FISCAL NOTE H 194